Trouble in Mannyland : Politics, Bankruptcy Case Rock Empire Built on Trash

Manny Asadurian gazed at his diamond-crusted watch; then, glancing over as his stretch limo was being loaded onto a trailer for a trip to the shop, he spotted two missing chrome air valve caps on his tires.

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“Damn!” he said. “You can’t park this thing anywhere.”

Striding into the huge garage on his 11-acre ranch called “Mannyland,” Asadurian squeezed past his Rolls-Royce and ran one hand over his red Ferrari Testa Rossa on his way to a tool table to look for some replacement caps.

It was just a little problem, but it brought larger troubles to mind.

First was the 3-year-old bankruptcy case threatening the future of Asadurian’s garbage company and the whole trash empire he and his family have built in Ventura County over the years.

Then came the more recent political controversy over a $3,500 payment by Asadurian to Moorpark Councilman Scott Montgomery while the councilman was voting on city trash contracts--which led to criminal charges against Montgomery, his resignation from office and a falling out between the men.

Because of the bankruptcy case, Asadurian said, some of his friends have started telling him he should not even be driving around anymore in the limousine or his Rolls with the “MANNY” vanity plates.

“What am I going to do? Lie? Pretend I don’t have any money?”

Shrugging, Asadurian found the extra caps he was looking for, stuck them on the limo tires, then sent the vehicle on its way to have more interior oak paneling installed and the doors lowered to make it easier to get in and out.

Hopping onto a yellow golf cart, he was off on a quick hunt in the early afternoon for a groundskeeper named Ramon--past a life-size Colonel Sanders mannequin that reminds Asadurian of his late father, past the “Welcome to Mannyland” sign and out the front gate guarded by two 10-foot-tall toy soldiers.

Then it was all the way around the estate to a side entrance and up to the motor pool. Asadurian screeched to a halt, ordering Ramon onto the back of the cart. Then he took off again.

This time it was past mannequins dressed in cowboy and Native American garb, riding plastic ponies and driving old stagecoaches . . . and past the compound’s grass volleyball courts, a horse corral and an artificial lake stocked with catfish . . . and past the western town with its miniature saloon . . .

And past the miniature hotel that has bunk beds where real-life guests can stay . . . and past the miniature chapel the family calls St. Louise after Asadurian’s mother . . . and past the tiny mock Wells Fargo Bank that is actually an outhouse.

“I tell people that’s where they gotta go to make a deposit,” Asadurian said before suddenly slamming on the brakes and pointing at a red stagecoach parked on a hill not too far away from a toy rocket that was once part of a carousel.

“Ramon, see that,” he said loudly. “I want you to tell the guy to paint the wheels red and put it up on blocks. Make sure it looks real nice, OK?”

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Everything looks real nice in Manny Asadurian’s personal magic kingdom--built with the millions he and his brother Sam made picking up other people’s trash for 40 years. But all is not well in Mannyland.

The Asadurians--Manny, 63, Sam, 68, and their sons Manny Jr., 39, and Carl, 43--operate G.I. Industries, an eastern Ventura County business that picks up trash for 40,000 customers in Simi Valley, Thousand Oaks and Moorpark.

Mired for more than three years in a complicated and contentious bankruptcy, the Asadurians are openly worried that the company, which will bring in about $20 million this year, may finally slip out of their hands.

As if that were not enough, the Montgomery political scandal just won’t go away. In October, Montgomery pleaded guilty to one felony conflict-of-interest charge and one misdemeanor conflict-of-interest charge, but he has since changed his mind and wants to revoke his plea.

Asadurian has called the $3,500 payment a loan. But Montgomery says he sold a computer to Asadurian. Known for his generosity and his joy at entertaining local schoolchildren at the ranch, Asadurian shows his anger these days when the subject comes up.

He was just trying to help Montgomery out, Asadurian said. And now he says he wishes the former councilman would just admit he took the money. “If I’d known there was anything wrong with giving him the money I would have never given it to him,” Asadurian said loudly. “But to have him lie about it like that hurt me and my family. . . . Why can’t he just admit he took the money and be done with it?”

They were never close friends, Asadurian added. And, frustrated that G.I. Industries could go on the auction block in December and be sold out from under the family, Asadurian says he has enough to worry about without having to deal with the Montgomery controversy.

“I got people in there, that I don’t even know running the company, that I figure I own,” he says. “I hope something happens soon so that I can breathe easy again. . . .I don’t want to have to sell the business and walk away.”

The company took Asadurian and his family decades to build.

When they were young, Sam, Manny and their three sisters all helped their father, who had a truck and picked up trash in Venice. The whole family helped to bundle rags and newspapers that were later sold.

“Manny and his family were scavengers--recyclers--for a living--them and hundreds of other Armenians in Southern California,” said John Waddell, the editor of Refuse News, a newsletter that covers the rubbish industry. “No one else wanted to do that kind of dirty work, so it fell to the immigrants.”

Being part of the rough and tumble rubbish-hauling business was tough for a teen-ager. Competitors burned each other’s trucks and fought openly over turf in Los Angeles. But, although they were often harassed at school for working on garbage trucks, the brothers liked the job.

When Sam was drafted into the Army in the early 1940s, Manny started driving the truck for his father in southwest Los Angeles. He was 12, smoking, and darkening the peach fuzz above his upper lip to make himself appear older.

And by his late teens, Asadurian was a veteran. At either 16 or 17--he can’t remember exactly--he says, he decided to pull out of the Los Angeles garbage wars and look for new territory. He moved to the San Fernando Valley and started his own company, G.I. Rubbish, named after the GIs returning home from World War II.

By the time he was 19, Asadurian had married. His wife, Gloria, would drive the truck and he would hoist the trash on board. His brother, Sam, was also in the San Fernando Valley, and had his own commercial rubbish business called S&A; Disposal.

In the post-war economic boom, homes were sprouting up from Burbank to Reseda. It was the right time to get into the trash business.

The Asadurian brothers merged their companies in the early 1950s, and then joined in a partnership with Louis Visco, known at the time as “the rubbish czar of the San Fernando Valley.”

Eventually the company, which took on the G.I. name, was making thousands of dollars a day, but it wasn’t without its problems. As Sam Asadurian likes to say, “The industry always had an image problem.”

And the Asadurians say they were tagged by Los Angeles law enforcement officials as “known-associates of organized crime”--associations both brothers freely admit.

In the early 1970s, the Asadurians say, they once hired a man named Luigi Gelfuso, who in the mid-1980s was identified as an enforcer for the Milano crime family in Los Angeles by a U.S. Justice Department Strike Force on Organized Crime. Gelfuso pleaded guilty in 1988 in Los Angeles federal court to extortion conspiracy, narcotics conspiracy and labor conspiracy charges. He was sentenced to eight years in prison.

“A nicer person you can’t meet,” Manny Asadurian said about Gelfuso, who has since been released from prison.

Asadurian added that there is a difference between knowing gangsters and committing crimes.

“We was called downtown once and they had pictures of everybody, and my pictures was up there,” he said. “And they say, ‘We know you know all them people.’ I says, ‘Yeah, but I don’t know what they do. They just know I’m the rubbish man.’

“Them guys never did do me any favors,” Asadurian added. “I never had a problem. Isn’t that funny? I think if they know you’re gonna pull [something], they’ll help you pull it. If they know you’re not gonna have nothing to do with ‘em, they’re not gonna steer you into nothing.”

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When Manny and Sam Asadurian moved to Ventura County in the 1960s, they say, they came to retire. The pair sold their share of the original G.I. Rubbish to Visco, who turned around and sold the business to a larger company.

Sam Asadurian, who had always dreamed of being a jockey, was the first to move to the county, buying 22 acres in Moorpark and starting up a thoroughbred horse ranch. Manny Asadurian followed him in 1968, buying half the property and starting up his own 11-acre hilltop ranch next to his brother’s.

Manny, then still in his 30s, wanted to enjoy his time off.

“I think we was retired for about a year or something like that,” Manny said.

The brothers had hoped to send their sons to college, but by the early 1970s, the boys had other plans. Around the business all their lives, Carl and Manny Jr. wanted a chance to run a company. So their fathers obliged them.

The two generations worked together. The fathers identified the small companies they wanted to buy, and their sons would check them out. Then all four would go to the bank together to borrow the money.

“It was a real Mom and Pop operation at first,” said former Thousand Oaks Councilman Alex Fiore. “I remember they were keeping the accounts and receipts in shoe boxes.”

The companies, with routes in Thousand Oaks, Simi Valley, Moorpark and the unincorporated portions of eastern Ventura County, were all consolidated under one roof as G.I. Industries. The Asadurians showed their sons the ropes, as their father had shown them.

“My dad taught us that if someone takes a route because you’re doing a bad job, you don’t deserve to have the account,” Manny Asadurian said. “But if a guy goes and takes your job for cheaper [wages], you stay on the job till he comes around and you beat the . . . out of ‘em, because he lied to that customer.”

Despite the tough talk, community leaders in cities where the Asadurians do business swear by the family and the company.

“I guarantee that Manny not only knows the names of every driver, but he also knows the names of their wives and children,” said Simi Valley City Councilman Bill Davis.

“The bottom line here is we’ve never had any problems,” Davis said.

Over time, the family and its company developed a reputation for service, and rarely received complaints.

“We know the rubbish business,” Sam said. “We know how to keep a town clean . . . and make sure a company don’t go on strikes and leave the towns messy or nothing like that.”

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Their motto had always been, “If you spit we’ll clean it.” And in the early 1980s the family decided to take the company and the philosophy public, hoping to attract a huge influx of cash and then diversify the business.

The idea was to merge the family’s various enterprises into a holding company and over two years issue stock for the company, Asadurian said. As stocks were bought up, the company would get an influx of capital that it could use to expand and diversify. Grossing an estimated $8 million to $10 million annually in the early 1980s, the family hoped to take G.I. Industries to $100 million by 1992.

That was the plan at least.

“I didn’t want to do it,” Manny Asadurian said in a deposition connected to the bankruptcy. “The next thing I knew I was chairman of the board, which I never heard of, ‘chairman of a board.’ I didn’t even know what that meant.

“They told us how much money we was gonna make,” he said. “We didn’t need no money. I had everything in the world. I had every kind of car. My home was built . . . we was running a lot of race horses. We had everything we wanted.”

Sam Asadurian says he supported going public because he thought it would lift a huge burden off the family.

“Instead of me, my son, my brother and Junior all chipping in $100,000 a piece every time we wanted to buy somebody out, the public company would put it up for you,” he said.

What exactly happened next--who really made money and who really lost money--is a matter of much dispute, bankruptcy court records show. The Asadurians say they were hoodwinked and hobbled by Wall Street types who seduced them with visions of untold riches.

But in court records in Santa Barbara, creditors and attorneys representing bankruptcy trustee Ron Durkin, appointed by U.S. Bankruptcy Judge Robin Riblet to oversee the business, say that the Asadurians may have had trouble distinguishing what belonged to the publicly held company and what belonged to the family, and that they allegedly sold off company assets and routes to family members at reduced prices.

According to a report by Durkin filed with the court, the Asadurians and their sons were ordered just before the company declared bankruptcy in 1992 to pay back $200,000 that company accountants alleged had been taken from the company by the issuance of a purchasing order for equipment that never existed.

The family said in a response in the case that there had been no wrongdoing and that the money had been promptly paid back. In interviews, family members expressed shock at the allegation.

“You know, everybody thought, ‘My God them guys are just going to rape the company and leave,’ ” Sam Asadurian said. “Well, how can we rape a company that’s us. We feel the company is us. It’s in our blood. It’s in our veins.”

But the family’s control of the company has dwindled now to about 35% of the outstanding shares. The next largest shareholder is Western Waste Industries of Gardena and its president, Kosti Shirvanian, who together control about 25% of the company shares.

The Asadurians had turned to Shirvanian for a $4-million loan in exchange for pledges of stock, according to court records. With interest and court costs, the records state, the debt has since grown to anywhere from $5 million to $12 million.

By 1989, with the company deep in debt, the Asadurians say they were looking to sell G.I. Industries. They approached Shirvanian, who lent them the money in exchange for a pledge of family stock, they say. The loan, which was used to keep the company afloat, was personally guaranteed by the Asadurian family, they add.

When Western Waste later came to collect on the debt--threatening to take the Asadurians’ homes and property if payment was not made--the Asadurians and their sons each declared bankruptcy. Without the family’s guarantees, the company was forced into bankruptcy court, too.

Lawyers for Western Waste have said in court records that the Asadurians abused their positions on the company’s board of directors and as corporate officers.

“It’s not a case of simple mismanagement,” said Western attorney Joel Ohlgren in court documents objecting to a recent shareholders meeting. “[The Asadurians] have personally benefited from their position of trust in complete disregard for the interest of the shareholders.”

If family members were trying to line their own pockets--as Western Waste and others have alleged-- Manny Asadurian asks why they would all put up their own homes and property to guarantee the $4-million loan.

Boiling with anger at a bankruptcy court hearing this past summer, he unleashed a torrent of vitriol at Ohlgren.

“I went up to the guy and called him every name in the book,” Manny said. “I said to him, ‘How could you keep calling me a crook? You crooked bastard. You never tell the truth.’ ”

Asadurian said he had to be held back by his attorneys.

“I can’t go to court anymore and listen to them lies they say about me and my family,” he added in a recent interview.

Bankruptcy Judge Riblet will decide in December whether it is in the best interest of the shareholders to sell the company to the highest bidder or let the Asadurians continue to manage the business.

Manny Asadurian said he and his brother meet with their sons most days at a local coffeehouse or at the G.I. offices to discuss how they can get their business back. He is sure that it is the right thing to do.

“You can’t help but make money in this business,” he said. “You can make money hand over fist.”

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It is a long and winding path up the driveway into Mannyland, past the wrought iron gate and the welcome sign, past the little petting zoo with potbellied pigs and white deer. It has become a family compound for the Asadurian clan, and Manny Asadurian feels secure with his family close by.

His brother lives just across the canyon. His daughter and son-in-law live in a house on his ranch. His mother, Louise, lived in another house on the ranch until her death this past summer, and he still keeps it just as it was before she died.

Asadurian’s home is at the end of the driveway, with a pool decorated with a huge color statue of Lucy from the Peanuts comic strip.

A short walkway leads from the end of the driveway to Asadurian’s two-story home. Inside the double doors are figurines, statuettes of elves and a huge living room with a vaulted ceiling.

There are two sweeping staircases with Christmas tree lights strung on the railings that lead to the bedrooms upstairs.

The room, carpeted in red, features white leather couches, candelabra chandeliers and more figurines, including a large white porcelain colt.

Here in the very heart of Mannyland, surrounded by his family and his toys, Manny Asadurian said he feels sure that his family can withstand the attacks against its business.

He has been trying to take it all in stride, he said. But he conceded that little things have been getting to him.

Like the continuing controversy about the $3,500 that went to Montgomery. He was just trying to help him out, he said, and he still wants the money back.

“I get a phone call, and heard he was in trouble delivering newspapers or something . . . he’s gonna lose his house and this and that,” he said. “That kind of thing really gets to me. I was just trying to help the guy out.”

And then there was the trouble this past summer with the electric company. Asadurian said the company told him that somehow unmetered electricity had been siphoned off onto his ranch for the last 18 years. The bill came to about $300,000--an issue that is still to be resolved.

“It hurts me when I read this stuff about me and my family in the paper,” Asadurian said, sitting on his white leather couch, looking almost puzzled.

Changing to something more pleasant, Asadurian pulled out a pile of dozens of handmade cards that local schoolchildren have sent him over the years in gratitude for getting to come and play at Mannyland.

He is happy when he sees the children at the ranch, he said. And his family is important to him. And he thinks it is also important for a man to tell the truth and stick by his word.

“I make a deal on a handshake, that’s the way I am,” he said.

Your name is the one thing you have that stays with you no matter what, Asadurian added. And people know the Asadurians.

“People know me. We have a good reputation,” he said, playing with his diamond pinky ring. “When I go to the Century Plaza Hotel, the head guy treats me like gold; Las Vegas, the same thing.”

But the bankruptcy, the controversy with Montgomery, and the allegations from creditors have hurt him, damaged his name, he said.

“I never done anything to hurt anyone or anything dishonest,” he said. “It makes it seem like I was pulling something under the table.”